WHY SELLING INSURANCE BASED ON PRICE IS NOT THE BEST VALUE FOR YOUR BUSINESS
by Britt Bertolucci Cao
Remember when your friends were all doing something and you wanted to do it and your Mom said if everyone was jumping off a bridge would you? Well, your Mom was probably right then, and she would be right now if you are considering selling insurance based on price, because “everyone” else is doing it.
You see the commercials from Big Box insurance companies touting about how they have the lowest prices, and the best prices for the most coverage and you think, “how can I compete?” Don’t fall into the trap of thinking you need to sell on price. There are other and better ways to sell insurance that will be a better fit for your agency and your customers.
Selling on value is significantly better than selling on price. When selling on value, you have to deliver on that value. According to a LinkedIn article from Executive Chair at Agency Revolution, Michael Jans, you as the agent, have to add value as the product passes through your hands to the consumer. Meaning, it’s not enough to just sell products any more. With consumer insurance choices increasing every day, value now needs to be added to your insurance products.
According to the same post, selling on price is a quick way to ruin your customer service. Customer Service gets disrupted due to customers being charged less, thus you have less money to spend on support staff and less to spend on those systems you should have put in place. Equating to less aide and guidance for your customers, they become dissatisfied and decide not to renew.
Agencyrevolution.com, wrote a post outlining their four reasons you should not fall into the selling insurance on price trap.
- Selling on price is one of two choices, and it’s the wrong one. You can be cheaper. Or you can be better.
- Selling on price kills profits and value.
- Selling on price is a fundamentally bad strategy for the independent agent & broker channel.
- Selling on price is a fundamentally bad strategy for the independent channel because the clients you want will pay more. Much more.
These four reasons are good to keep in mind the next time you think about going down the selling for price rabbit hole. In my next post we will take this idea a step further and look into how to add value to your products.